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Bushveld restructures CellCube investment


Bushveld Minerals is restructuring its investment in vanadium redox flow battery (VRFB) firm CellCube, increasing it slightly to 27.6%, as part of its own energy storage business carve-out.

The primary vanadium producer has entered into conditional agreement for a complex deal that will effectively increase its holding in Austria-based Enerox, better known by its brand name CellCube, from around 25% to 27.6%.

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CellCube is one of the longest-running VRFB firms in the world with 23MWh deployed globally across 130 systems, and has had a busy 2022 expanding its project portfolio.

Bushveld Minerals, meanwhile, is one of the three primary vanadium producers in the world along with Largo Resources and Glencore. This transaction, explained in more detail below, is part of the firm’s strategy to create a dedicated energy storage business.

Deal structure

The agreed transaction involves special purpose acquisition company (SPAC) Mustang Energy, and VRFB Holdings Limited, a vehicle which owns 50% of CellCube (or rather its 100%-owning parent company Enerox).

Mustang Energy and Bushveld Minerals subsidiary Bushveld Energy currently own 49.5% and 50.5% of VRFB Holdings Limited respectively, giving them both around 25% of CellCube. (This was after a transaction in August covered by at the time, which hasn’t technically completed.)

The deal announced today (28 November) will see Bushveld Energy sell its 50.5% stake in VRFB Holdings Limited to Mustang, for a consideration of US$19.4 million, leaving Mustang with 100% of VRFB Holdings Limited.

However, Bushveld will be paid via the issue of 69,353,604 new shares in Mustang as well as the conversion of existing loan notes in Mustang (held by Bushveld Minerals) to additional shares. After that is completed, Bushveld Minerals and Bushveld Energy together will hold 51.5% of Mustang.

That shareholding means that Bushveld will hold 27.6% of Enerox/CellCube (because Mustang owns 100% ownership of VRFB Holdings Limited which owns 50% of Enerox/CellCube).

As part of the sale, Bushveld Energy will have the right to appoint two directors to the board of Mustang and will enter into a lock-in agreement and relationship agreement.

Bushveld said the transaction with Mustang is an important step in its process to carve out Bushveld Energy from the Bushveld Minerals Group.

“The transaction provides Bushveld Energy access to the capital markets and will allow the company to achieve a transparent market value and attract specialist investors looking to participate in this exciting growing sector,” said Fortune Mojapelo, CEO of Bushveld Minerals.

“From our early days of investigating ways to support the development of VRFBs as a competitive long-duration energy storage (“LDES”) solution, Enerox was identified as a leader in the space with a compelling LDES proposition. The company has since gone from strength to strength with over 130 systems now deployed across five continents.”

“As we have communicated in recent months, we feel this is the right time for this emerging energy storage story to take on a life of its own, while still keeping an interest in the business and most importantly maintaining our vertically integrated business model.”

The transaction is conditional on regulatory approval as well as Mustang’s publication of a prospectus and readmission of its enlarged share capital on to the London Stock Exchange.’ publisher Solar Media will host the eighth annual Energy Storage Summit EU in London, 22-23 February 2023. This year it is moving to a larger venue, bringing together Europe’s leading investors, policymakers, developers, utilities, energy buyers and service providers all in one place. Visit the official site for more info.

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